China launches probe into EU dairy products

BEIJING

Beijing on Wednesday launched a probe into EU subsidies of some dairy products imported into China, the day after the bloc said it planned to impose five-year import duties of up to 36 percent on Chinese electric vehicles (EVs).

The investigation, which marks the latest barb in a trade standoff between the two, will cover a range of items including fresh cheese and curd, blue cheese, and some milk and cream, Beijing's Commerce Ministry said.

"The Ministry of Commerce has decided to initiate an anti-subsidy investigation on imported relevant dairy products originating in the European Union from August 21, 2024," the ministry said in a statement on its website.

Officials said they had received an application from the Dairy Association of China for an anti-subsidy probe into European products on July 29, and held consultations with the European Union on Aug. 14.

Beijing said the investigation would cover EU subsidy schemes implemented in the year up to the end of March 2024, and damages to China's domestic industry between the start of 2020 and the end of March this year.

The probe takes aim at major pillars of the bloc's setup including the common agricultural policy as well as national subsidy plans in Ireland, Austria, Belgium, Italy, Croatia, Finland, Romania and the Czech Republic.

It will last one year but may be extended for up to six months "under special circumstances," the ministry said.

The EU exported 1.68 billion euros ($1.87 billion) of dairy products to China last year, according to figures from the European Commission's Directorate-General for Agriculture and Rural Development, which cited Eurostat.

The EU Chamber of Commerce in China said the investigation "should not be considered a surprise" in the wake of the bloc's own imposition of import tariffs on Chinese EVs.

"Regrettably, the use of trade defense instruments by one government is increasingly being responded to seemingly in kind by the recipient government," the chamber said in a statement.

It said it "will be monitoring the ongoing investigation and hopes that it will be conducted fairly and transparently", adding that it expected its affected member firms to cooperate.